Key elements of a strategy at enterprise level

MNEs engagement in extending social security examples of practices 33 guidance. Other international references on this topic could be consulted, and especially the World Health Organization‘s resources on prenatal and maternity care 7 as well as essential medicines and health products 8 . Also, some of the elements covered by the United Nations General assembly Resolution on Universal Health Coverage adopted on 12 December 2012 might be useful, especially as regards special attention on exclusions the resolution presents the main health challenges today from a public health perspective which might provide insights on what should not be excluded from internally defined minimum healthcare packages at the enterprise level. The key steps related to the design and implementation of such a global strategy aiming at ensuring an internal minimum level of social protection to all of the company‘s workers are illustrated by figure 9. The identified process is detailed step by step in the following paragraphs. Figure 10. Key steps for the design and implementation of a global strategy to ensure social protection coverage for all workers at enterprise level Source: Elaborated by the authors. Engage with social partners At all stages of such private sector initiatives, it is important to engage with social partners inside and outside the company. – Inside the company, it is important to engage with workers representatives. First, they should have good insights on the social protection needs of workers. Second, it is a necessity to inform them it is mandatory in many countries since it occasions a modification in employment conditions. Third, it improves the impact of such programmes when workers‘ representatives actively contribute to the implementation. – Outside the company, bringing up the subject among employers and workers representatives at local, regional, national and international levels has the potential to greatly contribute to social dialogue on the extension of social protection, an aspect that will be developed in subsection 3.3. c the necessary pharmaceutical supplies on prescription by medical or other qualified practitioners; d hospitalisation where necessary; e dental care, as prescribed; and f medical rehabilitation, including the supply, maintenance and renewal of prosthetic and orthopae dic appliances, as prescribed.‖ International Labour Organisation: Medical Care and Sickness Benefits Convention, 1969 No. 130, Article 13. 7 Many resources available on the World Health Organisation web page dedicated to this issue: http:www.who.intmaternal_child_adolescenttopicsmaternalmaternal_perinatalenindex.html. 8 Many resources available on the World Health Organisation web page dedicated to this issue: http:www.who.intmedicinesenindex.html. 34 MNEs engagement in extending social security examples of practices Take stock of the existing provisions and conduct a gap analysis The stocktaking relates to the evaluation of the need for social protection and the coverage gaps in comparison with the company‘s ambition defined at an early stage. In order to be able to assess the need, it is paramount to have a clear picture of the social protection from which workers already benefit in each subsidiary. This implies the collection of the following information: – social protection legal coverage in each country of operation i.e. what national social security schemes are in place and what benefits are currently offered to workers? and assurance of compliance i.e. workers are affiliated and social security contributions are effectively being paid regularly by the subsidiary; – social protection complementary schemes offered by the subsidiaries by category of workers, if applicable; – quality of service received feedbacks from beneficiaries, especially when trying to assess the quality of healthcare facilities accessed by workers as well as their OOP expenditure. The stocktaking phase should allow for a clear vision on key indicators, and in particular the ILO methodology to develop basic indicators can be used 9 : – type of benefit covered the coverage scope; – coverage rate the extent of coverage: who is covered for each type of benefit, in percentage of workers; and – benefit level measure of the adequacy of benefits in comparison to the impact on the beneficiary should the risk covered occur. In the case of benefits implying a third party for service delivery like medical care insurance for instance, information on the quality of services delivered is also necessary. Information on the extent of coverage as regards dependants of workers family should also be collected. During that stocktaking phase, a benchmark can also be conducted in order to provide a picture of local practices on social protection complementary coverage among other companies in the same country, including competitors and sub-contractors. This is in accordance with the ILO Tripartite Declaration of Principles Concerning Multinational Enterprises and Social Policy The MNE Declaration 10 . Based on the information collected, the company can make comparisons and identify gaps of social protection coverage that could be filled by its new strategy. Here, the iterative process is fundamental and the company might want to fine-tune its global strategy and the orientations that were defined at an early stage in terms of ambition content of the internal minimum benefit package, time line for implementation, etc.. Often, the challenge is to prioritize between all identified gaps, taking into account that 9 See: International Labour Organisation: World Social Security Report 20102011 Geneva, 2011. 10 ―Wages, benefits and conditions of work offered by multinational enterprises should be not less favourable to the workers than those offered by comparable employers in the country concerned‖ International Labour Organisation Tripartite Declaration of Principles Concerning Multinational Enterprises and Social Policy, Article 33. MNEs engagement in extending social security examples of practices 35 coverage gaps may be truly different from one country of operation to the other or even between subsidiaries in the same country. Global guidelines should be designed accordingly. Design an adapted response at subsidiary level When implementing the global strategy at subsidiary level: it would be interesting for the company to gather information on the national strategy on social protection and social policies in general in order to anticipate probable changes in regulations and to evaluate the coherence of its own approach within the local context. When priorities are established and contingencies to be covered are selected, the company has to set minimum levels of social protection for all workers. The challenge is to set standard levels that can be adapted to each national context and legislation but that are still meaningful for the company at the global level. Monitor coverage and measure impact As illustrated by the case studies, there is room for developing tools in order to properly monitor and evaluate such private sector initiatives. When designing monitoring tools, it would be of interest to consider a set of harmonized indicators for which data is regularly collected through existing global monitoring channels. Using a set of harmonized indicators as part of local and global reporting tolls would enable a clear, consolidated picture of who is covered by what and how, and would foster transparency. When looking at impact evaluation, it could go beyond workers‘ satisfaction level and include impacts on workers‘ health and finances as well as a standardized economic impact evaluation on the company‘s business i.e. productivity, etc.. This last element should help assess and quantify the effects identified in part 3.1.1. Monitoring, reporting and evaluating such programmes is also a way of ensuring sustainability and quality of benefits by regularly assessing their adequacy and their integration within the business model of the company. Before the possible interactions between such global strategies developed by MNEs and national strategies for the extension of social protection are presented, it is important to review the ILO framework on this topic, which is the object of the following subsection.

3.2. ILO’s framework and instruments

The extension of social protection as well as the promotion of socially responsible economic development from a decent wor k perspective are at the heart of the ILO‘s mandate, as outlined further below. Accordingly, ILO constituents governments, workers and employers have adopted a number of legal instruments that lay down standards and principles for the provision of social security. These instruments are internationally agreed by the global economy players on how to tackle these issues, and they can provide a useful framework as regards interactions between States and companies on social issues and are therefore succinctly described in the following paragraphs. A list of tools available to constituents is also provided in appendix and can be useful to expand on this section and to guide projects according to pertinent internationally agreed standards. It is notable to underline the uniqueness of International Labour Standards ILS as these legal instruments lay down the basic minimum labour standards agreed among ILO‘s three constituents governments, employers and workers and thereby among the main 36 MNEs engagement in extending social security examples of practices actors in the world of work. Once a year, the tripartite constituents meet at the International Labour Conference ILC where they adopt the ILO‘s broad policies and Conventions and Recommendations. After adoption by the ILC, Conventions can be ratified by member States, thereby creating legally binding obligations. In turn, Recommendations serve as non-binding guidelines. While enterprises may not be direct subjects of international law they are nevertheless bound to the operating conditions prescribed by Governments within their jurisdiction including international standards to which the latter have bound themselves through ratification. What is more, whether or not member States ratify ILO Conventions, the principles that lie therein can still serve to guide governments and enterprises‘ behaviour. After all, having been adopted by the ILC, ILO legal instruments embody the outcome of international social dialogue and legal consensus between government, trade unions and employers on how a particular labour problem could be tackled at the global level. When reviewing the role of the ILO in the context of promoting CSR, it is important to recall that ILO standards reflect the knowledge and experience of all players in the global economy. Stakeholders, such as multinationals, can thus benefit from the guidance of these internationally accepted standards and apply them, to the extent possible, to their policies, operational objectives and day-to-day actions. The incorporation of this corpus of international laws by all global actors also allows greater integration of the international community as a whole. Furthermore, in its function to promote social dialogue between its tripartite constituents and its standard setting mandate, the ILO can serve as a critical player in encouraging and fostering a better understanding of CSR. It should also be noted that the ILO can create a prosper environment for CSR initiatives as part of its role to provide and promote technical assistance, technical cooperation and capacity building to address problems in national legislation and practice in conformity with the ILO standards and by bringing international instruments. In this regard, it is no surprise that most CSR initiatives, including codes of conduct, mention the principles laid out in ILO Conventions and Recommendations and in particular in the ILO‘s eight fundamental Conventions 11 , principles which can also be found in the ILO‘s Declaration on Fundamental Principles and Rights at Work, described in further detail below.

3.2.1. ILO’s mandate and standards in social security:

Extending social protection From an international legal perspective, the recognition of the right to social security has been developed through universally negotiated and accepted instruments that establish social security as a basic social right to which every human being is entitled. The right to social security has been enshrined in several UN human rights instruments and is expressly included in fundamental human rights instruments, namely the Universal Declaration of 11 Freedom of Association and Protection of the Right to Organise Convention, 1948 No. 87, Right to Organise and Collective Bargaining Convention, 1949 No. 98, Forced Labour Convention, 1930 No. 29, Abolition of Forced Labour Convention, 1957 No. 105, Minimum Age Convention, 1973 No. 138, Worst Forms of Child Labour Convention, 1999 No. 182, Equal Remuneration Convention, 1951 No. 100, Discrimination Employment and Occupation Convention, 1958 No. 111. MNEs engagement in extending social security examples of practices 37 Human Rights 12 UDHR, and the International Covenant on Economic, Social and Cultural Rights ICESCR 13 . The ILO was established as an authority in the field of social security since the foundation of the Organization in 1919 14 . From 1919 to the end of the Second World War the tripartite members of the ILO adopted 15 Conventions and 11 Recommendations which developed and consolidated the social insurance model. These first generation standards covered principles of the ―social insurance era‖ including: compulsory social insurance systems for specific branches, administrative and financial supervision of the State, and participation of insured persons. The ILO‘s mandate in the promotion of social security was widened in 1944 by the Declaration of Philadelphia, the first international legal instrument to stipulate the right to social security as a right belonging to all, and the first expression of the world community‘s commitment to the extension of social security to all 15 . Following this new mission and mandate, the ILO adopted a series of reference Conventions and Recommendations transforming the concept of social security into a statutory institution of the modern State. Commonly referred to as the second generation standards, the three Conventions and four Recommendations adopted between 1944 and 1964 envisaged unified social security systems aiming at universal coverage, comprising a range of recognized social risks, and the provision of benefits compatible with human dignity and social assistance for the uninsured. These standards marked the era of social security of which Convention No. 102, described further below stands as the flagship, embodying the internationally accepted definition of the very principle of social security. All subsequent standards five Conventions and five accompanying Recommendation adopted in the third generation between 1965 and 1988, draw from Convention No. 102 and seek to offer higher levels of protection in terms of the population covered, and the benefits rates and types. In 2001, more than 50 years after the Declaration of Philadelphia, social security was reaffirmed by the ILC as a fundamental human right and its extension to all in need was restated as an integral part of the ILO‘s mandate 16 . It followed that in 2003, the ILO launched the Global Campaign on Social Security and Coverage for All seeking to extend 12 Universal Declaration of Human Rights, General Assembly Resolution 217 AIII, 1948. 13 International Covenant on Economic, Social and Cultural Rights, General Assembly Resolution 2200AXXI, 1966. 14 Indeed, the International Labour Organisation ‘s mandate to promote social security and further this right was already an integral part of the International Labour Organisation Constitution whose Preamble recognized the need to improve conditions of labour in respect of ―prevention of unemployment, … the protection of the worker against sickness, disease and injury arising out of his employment, … provision for old age and injury‖ Constitution of the International Labour Organisation, 1 April 1919, Preamble and Art. 1. 15 ―Solemn obligation of the International Labour Organization to further among the nations of the world programmes which will achieve‖, among others, ―the extension of social security measures to provide a basic income to all in need of such protection and comprehensive medical care‖, as well as ―provision for child welfare and maternity protection‖ . Declaration concerning the aims and purposes of the International Labour Organisation Declaration of Philadelphia, adopted by the International Labour Conference at its 26th Session, held in Philadelphia, on 10 May 1944, Article IIIf and h. 16 International Labour Organisation: Resolution and Conclusions concerning social security, International Labour Conference, 89 th Session, Geneva, 2001.